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didn't know if this would fit in work and employment (or as someone else coined it, unemployment forum ) or this one, but my last job's 401k, i will get contacted by the 401k company to transfer my funds eventually, right?
They might contact you, but it unlikely, They will let your 401K sit in whatever funds you have it in. (or you move it from/to)
You can have it tranfered from the 401K to a IRA, fiduciary to fiduciary. (One Fund company to another) so you can then manage it. Its IMPORTANT that you do not get the check/money There is tax withholding on it, when you deposit it you need to make up the withholding from other sources of money and get a refund when you file taxes the next year.
Best is to have 401K Send it directly to your IRA at some other company.
didn't know if this would fit in work and employment (or as someone else coined it, unemployment forum ) or this one, but my last job's 401k, i will get contacted by the 401k company to transfer my funds eventually, right?
unlikely. Most times it will stay in the plan where you left. It is your responsibility to 'roll it over' to an IRA or whatever you want to do with it.
If you like your new plan, contact your new company HR dept and get the phone #'s for your new plan admin to start the process to roll your funds over...
There's nothing wrong with leaving a 401k where it is as long as the choices are good. The imperative to roll a 401k over to an IRA is to a great extent something pushed by advisers looking to get their mitts on related advisory fees, and folks repeating their advice. If anything 401ks are marginally safer repositories for retirement savings than IRAs (though that marginal advantage is not enough to justify fees, high ERs, etc.)
there is a huge problem leaving money in a plan with a company when you do not have to and 99% of the folks out there who say its okay are not aware of what the issues are. the issues have nothing to do with expenses or choices in investments but have to do with employees in a plan being married..
the problem with leaving money with a former employer is if the employer goes out of business at some point or the plan is terminated for whatever reason you lose access to your money as well as controlling the investments if you want to make switches for months...
it happened to me while i was still with the firm.
the problem is when the plan is terminated for any reason the money is frozen in limbo up until:
all employees AND FORMER EMPLOYEES with money in the plan have spousal consent forms signed and returned.
because the plan is distributing the money all married folk have to have spousal acknowledgment the money is no longer in the company possesion.
that is easy with the existing employees to get but tracking down former employees and following the law running ads in papers takes months.
you are frozen from your money for months. it took 5 months before the laws were satisfied and the plan money released .
why take that risk when you have the option of taking your money under your own control when you leave.
unless you have gone through it you don't even know these laws work like this.
the problem with leaving money with a former employer is if the employer goes out of business at some point or the plan is terminated you lose access to your money as well as controlling the investments if you want to make switches for months...
Or weeks, or days. And you're typically warned in advance that it will be happening. And have a chance to do the rollover at that time. I suspect your experience was wildly unique since it resembled what has happened to me not one bit, nor is your story regularly repeated by others who have experienced plan custodian changes or plan terminations, so I suspect there is more to your specific situation than you're exposing, distinctions that would make clear the difference between your special situation and the situation that the OP is asking about.
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) or this one, but my last job's 401k, i will get contacted by the 401k company to transfer my funds eventually, right?
